Tesla Lags In Race To Produce Mass Market Electric Cars The Model 3 is supposed to take Tesla mainstream and bring it to profitability. But CEO Elon Musk's company has missed production goals, and analysts wonder whether he's spreading himself too thin.
NPR logo

Tesla Going At 'Warp Speed,' But Lags In Race To Produce Mass Market Electric Cars

  • Download
  • <iframe src="https://www.npr.org/player/embed/567564866/567573022" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript
Tesla Going At 'Warp Speed,' But Lags In Race To Produce Mass Market Electric Cars

Tesla Going At 'Warp Speed,' But Lags In Race To Produce Mass Market Electric Cars

  • Download
  • <iframe src="https://www.npr.org/player/embed/567564866/567573022" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript

ROBERT SIEGEL, HOST:

The electric car maker Tesla and its CEO, Elon Musk, are racing to build a car for the masses. The Model 3 is the one that's supposed to take Tesla mainstream and make it profitable. The company says it will turn out thousands of vehicles every week. So far, it has produced just a few hundred in nearly six months, and competitors are turning up the heat. NPR's Sonari Glinton has more from the LA Auto Show.

SONARI GLINTON, BYLINE: You can see here just how different Tesla is. Tesla only has one car on display. There's no glitz, no models - just a car and a few folks handing out brochures.

REBECCA LINDLAND: Even if they're not in the booth, they're around the booth like a magnet. The only other biggest one is Infinity over there, and they've got donuts that are on fire (laughter).

GLINTON: Who are you?

LINDLAND: Rebecca Lindland, executive analyst for Kelley Blue Book.

GLINTON: OK, she's being literal. They were actually cooking donuts with blowtorches.

UNIDENTIFIED WOMAN: Fire up.

UNIDENTIFIED MAN: Fire them up.

GLINTON: Anyway, Lindland is an admitted Tesla and Elon Musk fan.

LINDLAND: Nothing Tesla does is normal, so let's start there - I mean, which is part of the appeal. He pushes people to think further and faster, and we need people like that.

GLINTON: Elon Musk and Tesla have innovated almost every part of making the car - innovated battery making, even cars sales. And the Model S is almost universally considered one of the best vehicles of the century. But the Model 3, the new car Tesla's trying to build, is the company's make-or-break car. It's Tesla's promise of an affordable electric car. But right now the Model 3 has fallen way short of production goals. There have even been reports of workers putting the car together by hand. Meanwhile, Lindland says there are hundreds of thousands of customers who've put money down and are waiting for a Model 3. She's one of them.

LINDLAND: They have to stop over-promising and under-delivering. You've got to start producing cars and putting out realistic timelines. But don't say you're going to produce 5,000 in a month and produce a few hundred.

GLINTON: What makes Tesla different is the cult of personality around Elon Musk. Can you even name another car CEO? But here's Elon Musk sending rockets into space, and he wants to build a pneumatic tube between LA and San Francisco. Kids think he's cool. Listen to the crowd reaction in this clip of Musk anticipating the problems with the Model 3 from this summer.

(SOUNDBITE OF ARCHIVED RECORDING)

ELON MUSK: Terms of production, the - is how do we build a huge number of cars? I mean, if - and frankly, we're going to be in production hell. (Laughter) Welcome, welcome.

(LAUGHTER, CHEERING)

MUSK: Welcome to production hell.

GLINTON: But here's the thing. The other companies like Toyota, General Motors and Volkswagen are not in production hell. They don't just build cars and trucks. They build assembly lines efficiently. Volvo is going electric, and General Motors announced today a plan for commercial self-driving vehicles. Jeffrey Osborne is a stock analyst with Cowen. He says this is the worst time for Tesla to be having basic car assembly problems with things like welding.

JEFFREY OSBORNE: You know, the turnover in management's been pretty high. He's a tough guy to work for and it's a company that's going, you know, warp speed. We just wish they would, you know, take a pause, come up for fresh air, focus just on getting the Model 3 right.

GLINTON: Jean Jennings is a founding editor of Automobile Magazine. She says for all the excitement around Tesla, every single major car company is at this moment either designing or building electric and hybrid vehicles.

JEAN JENNINGS: Tesla's going to have a hard time when they're up against the rollouts of the electric vehicles from all the performance players - BMW, Porsche, Mercedes. I mean, they already have them, but it's going to get more and more and more - and Ferrari, even.

GLINTON: Now, that doesn't include competition from the companies pushing self-driving like Google. Jennings says Elon Musk reminds her of the swaggering auto executives of old.

JENNINGS: When a man presents himself with the ego as big as Los Angeles, when he takes a stumble - a public stumble, there are plenty of people waiting there, and it's not to pick him up.

GLINTON: Anyone that you talk to here will say Tesla eventually has to start making these cars. The question is when and how long consumers and Wall Street will wait. Sonari Glinton, NPR News, Los Angeles.

[POST-BROADCAST CORRECTION: In the audio, as in a previous Web version, we say Tesla had only one car on display at the LA Auto Show. In fact, the automaker is showing three car models at the show.]

(SOUNDBITE OF PAUL KALKBRENNER'S "AARON")

Copyright © 2017 NPR. All rights reserved. Visit our website terms of use and permissions pages at www.npr.org for further information.

NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.